The global oil market reacted sharply on Monday as crude prices fell after the United States, Israel and Iran reached an agreement aimed at ending months of conflict across the Middle East.
According to TheCable, Brent crude, the international oil benchmark, dropped by about 5 per cent to $82.90 per barrel, while US West Texas Intermediate (WTI) crude fell 4 per cent to around $80 per barrel.
The decline follows the announcement of a peace agreement that includes plans to reopen the Strait of Hormuz, one of the world’s most important shipping routes for oil exports.
Oil prices had surged when the conflict erupted in February. Brent crude climbed from $62 per barrel on February 16 to $79 by early March as tensions escalated. During the height of the war, prices briefly reached as much as $125 per barrel amid fears of supply disruptions.
The latest drop reflects growing optimism that energy supplies will stabilise following the breakthrough.
Reports indicate that the United States and Pakistan said a formal agreement to reopen the Strait of Hormuz is expected to be signed in Switzerland on Friday. The move is being viewed as a major step towards ending a conflict that has claimed thousands of lives and unsettled global energy markets.
US President Donald Trump announced on social media that the agreement with Iran had been finalised.
“The Deal with the Islamic Republic of Iran is now complete,” Trump wrote, adding: “Ships of the World, start your engines. Let the oil flow!”
Iran’s Deputy Foreign Minister Kazem Gharibabadi also welcomed the development, saying the agreement would bring an immediate end to hostilities and pave the way for further negotiations aimed at securing a permanent settlement within the next two months.
Analysts say the reopening of the Strait of Hormuz could ease concerns over global oil supply and reduce pressure on energy markets that have faced months of volatility since the conflict began.
